INDIA GLYCOLS LIMITED Vs. STATE OF U P

JUDGEMENT

(1.) Heard Shri Milan Banerjee, Senior Advocate. Shri Bharat Ji Agarwal and Shri Piyush Agrawal for the petitioner, and the learned Chief Standing Counsel and Shri C. S. Singh for the respondents.

(2.) This writ petition has been filed praying for a writ of mandamus directing the respondents not to realise licence fee for the Excise Year-2000-2001 and subsequent financial year for all the products manufactured by the petitioners in its factory. The petitioner also prayed for quashing Rule 3 (a) of U. P. Licence for Possession of Denatured Spirit and Specially Denatured Spirit Rules. 1976.

(3.) The petitioner is a private limited company incorporated under the Indian Companies Act, 1956. It manufactures chemicals and for that purpose requires molasses/Industrial Alcohol as the main raw material for the manufacture of the aforesaid chemicals. The petitioner obtained licence in Form PD 2 from the Excise Commissioner. Allahabad, U. P, for establishing a distillery within the same premises in which the petitioner's main chemical factory is located. The petitioner then proceeded to establish a captive distillery for the manufacture of industrial alcohol (Ethyl Alcohol by 95% v/v/). As per letter issued by the Ministry of Industry, the petitioner did not have to obtain a separate Industrial licence for the manufacture of industrial alcohol as the petitioner established a captive distillery for 100% utilisation of Industrial Alcohol captive for manufacture of chemicals, Copy of the letter of the department of Industrial Development, Ministry of Industry dated 3.5.1985 is Annexure-1 to the petition. As alleged in paragraph No. 3 of the writ petition, from the distillery Alcohol is carried through closed and sealed pipes directly to the main chemical plant for manufacture of chemicals. The production of the chemicals commenced in April, 1989. The petitioner does not buy or obtain specially denatured spirit from any other distillery unit in the State. As one of the conditions of granting of FL/39 licence for transfer of Industrial alcohol in the captive distillery of the petitioners, the petitioners are prohibited from selling Industrial Alcohol so produced to outside parties and are required to consume the entire Industrial alcohol produced within the factory for the manufacture of finished chemicals. A copy of FL 39 Form issued by the Excise Department to the petitioner clearly showing that the petitioner shall captively consume the entire quantity of Industrial Alcohol manufactured in its captive distillery and shall not purchase/sell the Industrial Alcohol so produced is Annexure-2 to the writ petition.